LONGVIEW TIMBER PURCHASE

9 Months Ended

Sep. 30, 2013

Business Combinations [Abstract]

LONGVIEW TIMBER PURCHASE

LONGVIEW TIMBER PURCHASE

On July 23, 2013, we purchased 100 percent of the equity interests in Longview Timber LLC (Longview Timber) for $1.58 billion cash and assumed debt of $1.07 billion, for an aggregate purchase price of $2.65 billion. Longview Timber is a privately-held Delaware limited liability company engaged in the ownership and management of approximately 645,000 acres of timberlands primarily in Oregon and Washington. We believe Longview Timber has productive lands with favorable age class distribution that will provide us with optionality for harvest. Earnings, assets and liabilities from this business are reported as part of the Timberlands segment beginning in third quarter 2013.

Summarized unaudited pro forma information that presents combined amounts as if this acquisition occurred at the beginning of 2012, is as follows:

	QUARTER ENDED				YEAR-TO-DATE ENDED
DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER-SHARE FIGURES	SEPTEMBER 2013		SEPTEMBER 2012		SEPTEMBER 2013		SEPTEMBER 2012
Net sales	$	2,191	$	1,813	$	6,390	$	5,192
Net earnings attributable to Weyerhaeuser common shareholders	$	153	$	104	$	514	$	214
Earnings per share attributable to Weyerhaeuser common shareholders, basic and diluted	$	0.26	$	0.18	$	0.88	$	0.37

The following table summarizes the estimated fair values of identifiable assets acquired and liabilities assumed as of the acquisition date.

DOLLAR AMOUNTS IN MILLIONS	JULY 23, 2013
Current assets	$	46
Property and equipment	39
Timber and timberlands	2,654
Other assets	2
Total assets acquired	2,741
Current liabilities	10
Long-term debt	1,122
Other liabilities	5
Total liabilities assumed	1,137
Net assets acquired	$	1,604

The initial allocations of purchase price are recorded at the estimated fair value of assets acquired and liabilities assumed based upon the best information available to management. We are currently in the process of finalizing our valuations related to timberlands, certain pieces of property and their associated contracts. Our valuations will be finalized when certain information arranged to be obtained has been received and our review of that information has been completed.

In order to finance our purchase of Longview Timber, we issued the following:

• 29 million common shares on June 24, 2013, at the price of $27.75 per share for net proceeds of $781 million;

• 4.4 million common shares on July 8, 2013, at the price of $27.75 per share for net proceeds of $116 million, in connection with the exercise of an overallotment option; and

• 13.8 million of our 6.375 percent Mandatory Convertible Preference Shares, Series A, par value $1.00 and liquidation preference of $50.00 per share on June 24, 2013, for net proceeds of $669 million. Dividends will be payable on a cumulative basis when, as and if declared by our Board of Directors, at an annual rate of 6.375 percent on the liquidation preference. We may pay declared dividends in cash or, subject to certain limitations, in common shares or by delivery of any combination of cash and common shares on January 1, April 1, July 1 and October 1 of each year, commencing on October 1, 2013, through, and including, July 1, 2016. These shares will automatically convert on July 1, 2016 into between 1.5015 and 1.8018 of our common shares, subject to anti-dilution adjustments. At any time prior to that date, holders may elect to convert each share into common shares at the minimum conversion rate of 1.5015 common shares, subject to anti-dilution adjustments.

For issuances of shares, excess of par value is recorded in "Other capital" in our Consolidated Balance Sheet.

Proceeds were used to finance the acquisition and pay related fees and expenses. We paid $11 million in fees related to a bridge loan in second quarter 2013. As of the close of the Longview Timber purchase, we did not use the loan and these fees were expensed in third quarter 2013, which is recorded in "Interest expense" in our Consolidated Statement of Operations.

We obtained additional debt financing in third and fourth quarter 2013 which was used to repay all of the assumed debt in fourth quarter 2013. See Note 9: Long-term Debt and Lines of Credit.